Justice News

Hospital And Cardiologist Settle False Claims Act Case

ATLANTA, GA - The United States Attorney’s Office announced it has reached settlements with Banks-Jackson-Commerce Hospital and Nursing Home Authority d/b/a Banks Jackson Commerce Medical Center (BJC) and Dr. Narasimhulu Neelagaru that total over $500,000.

“Kickbacks pervert our health care system, which is designed to insure that health care providers make decisions based solely on what is best for the patient,” said Sally Quillian Yates, United States Attorney for the Northern District of Georgia.

“The sustainability of the Medicare Trust Fund is dependent, in large part, upon medical facilities and professionals being prudent and responsible in their billing of health care programs,” said Derrick L. Jackson, Special Agent in Charge of the U.S. Department of Health and Human Services, Office of Inspector General in Atlanta. “This settlement demonstrates the OIG’s commitment to ensuring that those who bill the government for services do so in a manner that is in accordance with the law.”

The civil settlement resolves the United States’ investigation into BJC’s practices related to paying compensation to Dr. Neelagaru for professional services and medical director services that was in excess of fair market value. The alleged period for these improper payments and patient referrals was from 2000-2009. Because of the nature of these payments to Dr. Neelagaru by BJC, the United States claims that BJC received improper payments by the Medicare program for patients referred to BJC by Dr. Neelagaru.

This settlement also resolves a lawsuit filed by Ralph D. Williams under the qui tam, or whistleblower, provisions of the False Claims Act, which allow private citizens to bring civil actions on behalf of the United States and share in any recovery obtained.

The case, pending in the Northern District of Georgia, is filed under United States of America ex rel. Ralph D. Williams v. Banks-Jackson-Commerce Hospital and Nursing Home Authority d/b/a Banks Jackson Commerce Medical Center (“BJC”), Narasimhulu Neelagaru, M.D. and North Georgia Cardiology, PC, No. 1:08-cv-3235. Mr. Williams will receive a share of the settlement payment that resolves the qui tam suit that he filed. The claims settled in the civil settlement are allegations only, and there has been no determination of liability.

BJC reached its settlement with the United States in September 2010, but the case remained under seal pursuant to a Court order until the United States settled with Dr. Neelagaru. In connection with its settlement, BJC entered into a Corporate Integrity Agreement with the Department of Health and Human Services. That agreement imposes certain obligations on BJC to bolster its compliance program, including independent review of BJC’s financial arrangements with medical providers who refer patients to BJC.

BJC paid $329,000 to settle the case and Dr. Neelagaru has agreed to pay $200,000. The settlement resolves claims that BJC improperly billed the Medicare program for certain procedures and services rendered to patients in violation of the Physician Self-Referral Law, commonly known as the Stark Law, and in violation of the Anti-Kickback Statute.

This resolution is part of the government’s emphasis on combating health care fraud under the Health Care Fraud Prevention and Enforcement Action Team (HEAT) initiative, which was announced in May 2009, by Attorney General Eric Holder and Kathleen Sebelius, then-Secretary of the Department of Health and Human Services. The partnership between the two departments has focused efforts to reduce and prevent Medicare and Medicaid financial fraud through enhanced cooperation. One of the most powerful tools in that effort is the False Claims Act, which the Justice Department has used to recover more than $14 billion since January 2009 in cases involving fraud against federal health care programs. The Justice Department’s total recoveries in False Claims Act cases since January 2009 are over $20 billion.

This case was investigated by Special Agents of the Health & Human Services, Office of Inspector General. The civil settlement was reached by Assistant United States Attorney Christopher J. Huber.